9 ms·

when people argue that "digital distribution is essentially free," then ask why Soundcloud is losing money, since distributing music is literally their only rea

by aback 11y ago

when people argue that "digital distribution is essentially free," then ask why Soundcloud is losing money, since distributing music is literally their only real cost of doing business. we will continue to endure substantial cultural losses for so long as people continue to believe that content can & should be distributed and consumed for free. ultimately some sort of micropayments + blockchain-like-cloudserving might replace Spotify, Soundcloud, and all other streaming services with a decentralized system in which listeners compensate artists directly. until then the promise of disintermediation is just a fantasy. gatekeepers on the Internet control access to most content, particularly music.

printering 11y ago
The problem is that some people pay $10 a month for Spotify and others pay for services like Apple Music or Tidal. The question is how this income is split between the services (which deservedly should be profitable) and the musicians. Art has always had a shady connection to commerce in which the gatekeepers tend to profit more than the artists themselves.
- criddell 11y ago
  Musicians? Artists? Don't you mean rights holders?
zanny 11y ago
If you used something like ipfs, syncthing, or generic torrents you could easily distribute anything you want at large scale at no cost, as long as people were interested in having it. If you choose to centralize distribution on one web server that is your own choice, but the better phrase is "digital distribution is free if you want it to be". I doubt we will see a return to pay-to-listen models in music. Reality has taken too big of a bite around the copyright extortion ring surrounding sine waves. The future of music is in patronage, merchandising, and live performances - which really, it has always been. Only extremely rare unicorn performers ever have the stars align to be able to monetize their music itself (in the past it was making it big with a label, today last decade it was topping itunes) while we are seeing the rise of music as a viable profession without extraordinary fame as long as you can provide a niche and be good at it, you can attract enough whale fans to support you regardless of if the tracks themselves are free - your real audience is those that not only want what you already made, but want you to continue to make. Remember, as in all things IP, it is not the actual music file that is scarce or expensive to produce, it is the idea behind the music that took an artist hours or days to hand craft into a digital creation. The first iteration was the expensive one - all other ones are effectively free. It is essential that going forward we culturally recognize the distinction and move to seek sustainable business models around the former rather than the later, which we only invented as an imperfect way to translate ideas into the physical goods market back when they were less distinct than they are now (ie, costs of distribution did exist for paper books, so pigeonholing writing into markets via copyright was a reasonable train of thought when per-unit costs still existed and thus people could not effortlessly propagate the information on an individual basis).
- sbierwagen 11y ago
  If you used something like ipfs, syncthing, or generic torrents you could easily distribute anything you want at large scale at no cost, as long as people were interested in having it. The problem there of course is the "as long as people were interested in having it" part. You can publish stuff for free on Freenet, but to a first approximation, nobody actually uses Freenet. If a torrent/magnet URI runs out of seeds then it dies forever, unless you have a way to contact former seeds and beg them to give you a copy, etc etc. Bandwidth costs money, and always will. Distributing files costs money, and always will. The UX of peer-to-peer file sharing will always be more complex than "go to this WWW URL" if just to avoid the free-rider/spam problem.
  - URSpider94 11y ago
    This. Torrents are a terrible solution for the long tail of content.
    - colechristensen 11y ago
      This is false. There are a collection of private trackers run by motivated volunteers and paid for with meager donations which have collections far superior to the best paid services or archives anywhere or at any time in history. They do this by erecting and maintaining virtual economies where what you can get is limited by how much you've shared.
      - baddox 11y ago
        That's true, but private trackers have centralized costs and are often funded by donations or paid perks.
        zanny 11y ago
        You don't really need 100% uptime trackers, DHT lets you do peer to peer file discovery. There are trackerless torrents, the only problem being how you get the torrents in the first place, but all that takes is a magnet URI from the original uploader / creator somewhere.
jonknee 11y ago
> since distributing music is literally their only real cost of doing business. From the article it sounds like their main cost is paying a ton of people a lot of money.
jlarocco 11y ago
Honestly, I don't think the solution even requires that much creativity or innovation. Just in the past 3 or 4 months I've found half a dozen or more artists on Soundcloud, then headed over to Bandcamp or Amazon to buy and download their music. It would be awesome if I could buy it right there on Soundcloud. Every song could have a "Buy MP3" and "Buy Album" button right there by the Like, Share and other buttons. Maybe it wouldn't solve all of their problems, but it's better than what they have now.
- JTon 11y ago
  Or even work out some sort of revenue sharing / affiliation with Bandcamp/Amazon/iTunes
- erickhill 11y ago
  A lot of the music posted is a single here, a single there - often before official release. Sometimes it isn't weeks until that single (or larger album) is available for purchase. Plus, for the electronic/DJ side of things, many of the tracks posted are remixes which aren't ever for sale (it seems). But from a scale standpoint, you would think that there might be some sort of revenue opportunity there.
  - jlarocco 11y ago
    I don't see how that changes anything. Post the single with a "Available to buy on <some date>" notice. When it's officially released, take down the notice and put up "Buy now" buttons. And there's no reason they have to make every song available for sale or every song that's for sale available for streaming.
    - tomaskafka 11y ago
      Even better, either 'Let me know when it's available' or 'Auto-buy and add to my collection when it's out'.
  - floatrock 11y ago
    > many of the tracks posted are remixes which aren't ever for sale (it seems) Isn't there a fair-use provision where you can remix/sample works as long as you don't sell the derivative work or something like that? I think that's how a lot of the electronic music stuff works... people freely mix and remix stuff, give it away for free, and make their income doing live events and shows. That's my sense... anyone know if I got these details right?
multinglets 11y ago
This seems like incredibly abstract, spurious reasoning to say that something which as been around for many years will never be viable ever again.
mc808 11y ago
The difference between free and essentially free does become significant when you consolidate all of those essentiallies in one place. I couldn't find how much they spend on the distribution infrastructure itself, but if their 250 million monthly users were to bring in an average of 2-3 cents per month, they would net a profit, even after all the legal and administrative expenses on top of the actual cost of distribution. I'm kind of baffled that SoundCloud isn't already raking in profits. Presumably their stakeholders simply haven't pushed for profitability yet.
robotresearcher 11y ago
> since distributing music is literally their only real cost of doing business. Salaries dominate many or most business costs.
eikenberry 11y ago
I don't think we will ever overcome thousands of years of ingrained social sharing Norms, nor do I think we should. And if distribution is the problem then there are good existing solutions to the problem of bandwidth cost, e.g. torrents. There might be a way to monetize sharing digital content using some micropayment system like you say. Though I think that will have to come about after the current players have left or been marginalized as they don't care so much about helping the artists make a living, instead wanting to maintain control so they can get the money.
ahi 11y ago
HathiTrust.org, 13-14 million volumes has less than 20 FTEs and the vast majority of them are on new development projects. Put into maintenance it might take 2 FT sysadmins to keep going. Maybe double the cost for operations. Preservation and digital distribution is really really cheap. SoundCloud isn't losing $44 million on sysadmins, servers and network. It's all the other startup crap, sales, bizdev, legal that is doing them in.

by aback 11y ago

printering 11y ago

The problem is that some people pay $10 a month for Spotify and others pay for services like Apple Music or Tidal. The question is how this income is split between the services (which deservedly should be profitable) and the musicians. Art has always had a shady connection to commerce in which the gatekeepers tend to profit more than the artists themselves.

criddell 11y ago
Musicians? Artists? Don't you mean rights holders?

zanny 11y ago

If you used something like ipfs, syncthing, or generic torrents you could easily distribute anything you want at large scale at no cost, as long as people were interested in having it. If you choose to centralize distribution on one web server that is your own choice, but the better phrase is "digital distribution is free if you want it to be". I doubt we will see a return to pay-to-listen models in music. Reality has taken too big of a bite around the copyright extortion ring surrounding sine waves. The future of music is in patronage, merchandising, and live performances - which really, it has always been. Only extremely rare unicorn performers ever have the stars align to be able to monetize their music itself (in the past it was making it big with a label, today last decade it was topping itunes) while we are seeing the rise of music as a viable profession without extraordinary fame as long as you can provide a niche and be good at it, you can attract enough whale fans to support you regardless of if the tracks themselves are free - your real audience is those that not only want what you already made, but want you to continue to make. Remember, as in all things IP, it is not the actual music file that is scarce or expensive to produce, it is the idea behind the music that took an artist hours or days to hand craft into a digital creation. The first iteration was the expensive one - all other ones are effectively free. It is essential that going forward we culturally recognize the distinction and move to seek sustainable business models around the former rather than the later, which we only invented as an imperfect way to translate ideas into the physical goods market back when they were less distinct than they are now (ie, costs of distribution did exist for paper books, so pigeonholing writing into markets via copyright was a reasonable train of thought when per-unit costs still existed and thus people could not effortlessly propagate the information on an individual basis).

sbierwagen 11y ago
If you used something like ipfs, syncthing, or generic torrents you could easily distribute anything you want at large scale at no cost, as long as people were interested in having it. The problem there of course is the "as long as people were interested in having it" part. You can publish stuff for free on Freenet, but to a first approximation, nobody actually uses Freenet. If a torrent/magnet URI runs out of seeds then it dies forever, unless you have a way to contact former seeds and beg them to give you a copy, etc etc. Bandwidth costs money, and always will. Distributing files costs money, and always will. The UX of peer-to-peer file sharing will always be more complex than "go to this WWW URL" if just to avoid the free-rider/spam problem.
- URSpider94 11y ago
  This. Torrents are a terrible solution for the long tail of content.
  - colechristensen 11y ago
    This is false. There are a collection of private trackers run by motivated volunteers and paid for with meager donations which have collections far superior to the best paid services or archives anywhere or at any time in history. They do this by erecting and maintaining virtual economies where what you can get is limited by how much you've shared.
    - baddox 11y ago
      That's true, but private trackers have centralized costs and are often funded by donations or paid perks.
      - zanny 11y ago
        You don't really need 100% uptime trackers, DHT lets you do peer to peer file discovery. There are trackerless torrents, the only problem being how you get the torrents in the first place, but all that takes is a magnet URI from the original uploader / creator somewhere.

jonknee 11y ago

> since distributing music is literally their only real cost of doing business. From the article it sounds like their main cost is paying a ton of people a lot of money.

jlarocco 11y ago

Honestly, I don't think the solution even requires that much creativity or innovation. Just in the past 3 or 4 months I've found half a dozen or more artists on Soundcloud, then headed over to Bandcamp or Amazon to buy and download their music. It would be awesome if I could buy it right there on Soundcloud. Every song could have a "Buy MP3" and "Buy Album" button right there by the Like, Share and other buttons. Maybe it wouldn't solve all of their problems, but it's better than what they have now.

JTon 11y ago
Or even work out some sort of revenue sharing / affiliation with Bandcamp/Amazon/iTunes
erickhill 11y ago
A lot of the music posted is a single here, a single there - often before official release. Sometimes it isn't weeks until that single (or larger album) is available for purchase. Plus, for the electronic/DJ side of things, many of the tracks posted are remixes which aren't ever for sale (it seems). But from a scale standpoint, you would think that there might be some sort of revenue opportunity there.
- jlarocco 11y ago
  I don't see how that changes anything. Post the single with a "Available to buy on <some date>" notice. When it's officially released, take down the notice and put up "Buy now" buttons. And there's no reason they have to make every song available for sale or every song that's for sale available for streaming.
  - tomaskafka 11y ago
    Even better, either 'Let me know when it's available' or 'Auto-buy and add to my collection when it's out'.
- floatrock 11y ago
  > many of the tracks posted are remixes which aren't ever for sale (it seems) Isn't there a fair-use provision where you can remix/sample works as long as you don't sell the derivative work or something like that? I think that's how a lot of the electronic music stuff works... people freely mix and remix stuff, give it away for free, and make their income doing live events and shows. That's my sense... anyone know if I got these details right?

multinglets 11y ago

This seems like incredibly abstract, spurious reasoning to say that something which as been around for many years will never be viable ever again.

mc808 11y ago

The difference between free and essentially free does become significant when you consolidate all of those essentiallies in one place. I couldn't find how much they spend on the distribution infrastructure itself, but if their 250 million monthly users were to bring in an average of 2-3 cents per month, they would net a profit, even after all the legal and administrative expenses on top of the actual cost of distribution. I'm kind of baffled that SoundCloud isn't already raking in profits. Presumably their stakeholders simply haven't pushed for profitability yet.

robotresearcher 11y ago

> since distributing music is literally their only real cost of doing business. Salaries dominate many or most business costs.

eikenberry 11y ago

I don't think we will ever overcome thousands of years of ingrained social sharing Norms, nor do I think we should. And if distribution is the problem then there are good existing solutions to the problem of bandwidth cost, e.g. torrents. There might be a way to monetize sharing digital content using some micropayment system like you say. Though I think that will have to come about after the current players have left or been marginalized as they don't care so much about helping the artists make a living, instead wanting to maintain control so they can get the money.

ahi 11y ago

HathiTrust.org, 13-14 million volumes has less than 20 FTEs and the vast majority of them are on new development projects. Put into maintenance it might take 2 FT sysadmins to keep going. Maybe double the cost for operations. Preservation and digital distribution is really really cheap. SoundCloud isn't losing $44 million on sysadmins, servers and network. It's all the other startup crap, sales, bizdev, legal that is doing them in.